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(COLUMBUS, Ohio)—Ohio Attorney General Mike DeWine today
announced that Ohio is part of the $2.1 billion multi-state settlement with the
nation’s fourth largest mortgage servicer, Ocwen Financial Corporation of
Atlanta, Georgia, and its subsidiary, Ocwen Loan Servicing. The settlement was
agreed to by 49 states, the District of Columbia, and the Consumer Finance
Protection Bureau (CFPB).
“Ocwen is
yet another company who abused loan servicing standards against vulnerable
Ohioans throughout the mortgage financing crisis,” said Attorney General
DeWine. “Just as with the National Mortgage Settlement, I am pleased additional
homeowners will receive much-needed relief as part of this settlement.”
The settlement
addresses servicing misconduct by Ocwen and two companies later acquired by
Ocwen, Homeward Residential Inc. and Litton Home Servicing LP. Ocwen specializes in servicing high-risk
mortgage loans.
According
to documents filed in the U.S. District Court for the District of Columbia, Ocwen’s
misconduct resulted in premature and unauthorized foreclosures, violations of
homeowners’ rights and protections, and the use of false and deceptive
documents and affidavits, including “robo-signing.”
Under the settlement, Ocwen agreed to $2
billion in first-lien principal reduction, and $125 million for cash payments
to borrowers on nearly 185,000 foreclosed loans. In Ohio, Ocwen will provide
troubled borrowers with an estimated $37,723,909 in first lien principal reductions,
and 6,630 loans will be eligible to receive a cash payment. The payment amount, which is contingent on the
number of consumers who submit valid claims, is projected to exceed $1,000.
As part of the settlement, Ocwen agrees to
comprehensive new mortgage loan servicing and foreclosure standards. Ocwen’s
compliance with these new homeowner protections will be monitored by the Office
of Mortgage Settlement Oversight established in the February 2012 National
Mortgage Settlement with Ally/GMAC, Bank of America, Citi, JPMorgan Chase, and
Wells Fargo.
The Ocwen settlement does not grant immunity
from criminal offenses and would not affect criminal prosecutions. The agreement does not prevent homeowners or
investors from pursuing individual, institutional or class action civil
cases. The agreement also preserves the
authority of state attorneys general and federal agencies to investigate and
pursue other aspects of the mortgage crisis, including securities cases.
The final agreement, through a consent
judgment, will be filed in U.S. District Court in Washington, D.C. If approved by a judge, it will have the
authority of a court order. A settlement administrator will contact qualified
borrowers associated with foreclosed loans regarding cash payments.
Homeowners who have questions about this
settlement or other foreclosure and mortgage servicing issues can call the Ohio
Attorney General’s Office at 800-282-0515. Ohioans can also contact Ocwen directly at 800-337-6695 or at ConsumerRelief@Ocwen.com.
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